EUR/USD Continues Higher, Slips Back to $1.0800 Zone
Market movements on Wednesday intensified yesterday with price fluctuations in a wider range as market players reacted to news and data releases.The US dollar managed to end the trade at the end of the New York session with a re-strengthening after suffering a decline in the previous sessions.The US dollar weakened slightly at the start of the New York session as the initial reaction to the release of producer price index (PPI) data and poor US retail sales.However, analysts assess the published data as indicating that the US economy is headed for recession alongside the inflation rate which has fallen for 6 months in a row.The market was presented with a hawkish view by several Federal Reserve (Fed) officials such as James Bullard (St. Louis), Loretta Mester (Cleveland) and Esther George (Kansas City) who saw policy tightening still needed to lower the inflation rate to the 2% target.This again gives the impression that an aggressive increase in interest rates is still an option and will encourage the re-strengthening of the US dollar.Meanwhile in Europe, signals were again vague for the European Central Bank's (ECB) monetary policy as policymaker Francois Villeroy de Galhau stated that it was too early to speculate what the central bank will do in March.Examining the price movement on the chart of the EUR/USD currency pair on Wednesday yesterday, the price was seen to make an initial increase back to test the height tested throughout this week which is around 1.08700.However, a drop back in the price support zone of 1.08000 which still remains prevents the price from falling lower.Prices flattened slowly in the zone at the close of the New York session until continuing into the early Asian session this morning (Thursday).Expectations for further declines if continued will push the price towards the previous concentration zone at 1.07000.A more clearly displayed bearish trend movement can then be seen to reach the level of 1.06000.However, if there is a rebound from the 1.08000 zone, the high level reached this week is likely to be overcome to reach the 1.09000 zone.Passing the resistance will target the height of 1.1000 for the price to record the highest level in the latest 9 months.
Market movements on Wednesday intensified yesterday with price fluctuations in a wider range as market players reacted to news and data releases.
The US dollar managed to end the trade at the end of the New York session with a re-strengthening after suffering a decline in the previous sessions.
The US dollar weakened slightly at the start of the New York session as the initial reaction to the release of producer price index (PPI) data and poor US retail sales.
However, analysts assess the published data as indicating that the US economy is headed for recession alongside the inflation rate which has fallen for 6 months in a row.
The market was presented with a hawkish view by several Federal Reserve (Fed) officials such as James Bullard (St. Louis), Loretta Mester (Cleveland) and Esther George (Kansas City) who saw policy tightening still needed to lower the inflation rate to the 2% target.
This again gives the impression that an aggressive increase in interest rates is still an option and will encourage the re-strengthening of the US dollar.
Meanwhile in Europe, signals were again vague for the European Central Bank's (ECB) monetary policy as policymaker Francois Villeroy de Galhau stated that it was too early to speculate what the central bank will do in March.
Examining the price movement on the chart of the EUR/USD currency pair on Wednesday yesterday, the price was seen to make an initial increase back to test the height tested throughout this week which is around 1.08700.
However, a drop back in the price support zone of 1.08000 which still remains prevents the price from falling lower.
Prices flattened slowly in the zone at the close of the New York session until continuing into the early Asian session this morning (Thursday).
Expectations for further declines if continued will push the price towards the previous concentration zone at 1.07000.
A more clearly displayed bearish trend movement can then be seen to reach the level of 1.06000.
However, if there is a rebound from the 1.08000 zone, the high level reached this week is likely to be overcome to reach the 1.09000 zone.
Passing the resistance will target the height of 1.1000 for the price to record the highest level in the latest 9 months.
